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Part of the first session at the Open Source Drug Discovery for Malaria meeting at The University of Sydney, February 24th 2012. Speaker is Dr Luigi Palombi, ANU.

Summary:

The patent system. There is much mythology about the patent system, mainly that it’s needed for a) drug development and b) innovation. Reality is: not necessarily the case.

(01:29) What happened before the patents system? 1900 was approximate date of birth of patent system, 1883 for the UK. German national patent law passed around 1877. WIPO didn’t exist before 1900. The needs of the people (rather than patents) motivated people to develop medicines. Switzerland didn’t have a patent law until 1907. Novartis and Roche began before the patent system. Germany: 1969 changed law to allow patents on pharmaceutical substances. In most of the EU it wasn’t possible to patent a drug until 1978 when European Patent Convention came into effect. In England – 1919-1949 patents were prohibited on pharmaceutical substances. Yet we have modern medicines.

(4:00) Penicillin was developed without a patent. 1927 - Fleming notes a bacterium-killing substance. Florey later (1938) noted this observation and asked How to turn this observation into a medicine? The team worked in Oxford 1938-1941 without much funding to develop the drug for humans. This was a huge breakthrough for the war effort. The British government found it hard to convince industry to manufacture the drug. Government built a taxpayer-funded factory for this purpose. There was a patent for fermentation production eventually, but generally this was patentless drug development. Perhaps the patent system is applicable in certain areas, but modern pharma has become reliant on the patent model. Is it the way to solve the world’s most important diseases?

(8:00) What is open source? An excuse to get around the patent and copyright systems? Grew from software. In drug development – can this work? Should it really be needed? Ought we to have IP over everything in the drug discovery process? There are patents on drugs as well as research tools. There are patents on naturally-occurring biological materials. Ought there to even be patents on these things? The scope of patentable subject matter has grown. It has become more difficult for scientists to share information openly. This has influenced universities.

(10:10) 1980 - Bayh-Dole in the US. There were great examples where Universities were successful with exploiting patents. Stanford University and Cohen/Boyer breakthrough was a successful act of University patenting, prior to B-D. Generally the BD act has failed. Data suggests Unis are not good at promoting their IP. But the perception has grown that Unis need to create IP like a commercial entity. Now Unis are draconian in ways they implement their IP policies. Once the paragons of sharing and learning have joined the mythology of the patent system.

(11:56) For 3 years politicians and Cancer Council Australia and others have been trying to scale back level of patenting – particularly natural biological materials. Draft legislation is that natural substances are not patentable because they are not inventions. Many universties opposed, so did WEHI/Garvan, which are taxpayer-funded institutes. Many individuals also opposed it. Much philanthropic research funding comes with strings. We are creating mandates and barriers to research and therefore trying to invent open source to get round them. Do we need to go back in time?

(15:27) Polio Vaccine. Not patented – Salk said “Could you patent the sun?” Scientists have become part of the problem because they have succumbed to the myth that patents are required for research funding.

(17:00) Question from Nico Adams (CSIRO). Government-funded, but also funded by outcomes from IP protection. How does one go back to management and say that patents are not necessary? Palombi: level of funding of CSIRO has decreased. Governments have become open to the idea that taxpayers money shouldn’t be spent on research. CSIRO is reliant on public money. Solution – eliminate PPP’s and fund research fully. That is a policy/political decision. Military/auto spending is significant. Since 1980 – is it actually producing what was hoped. The BD act has not been a success. Universities are not good at converting IP to income. There should, by now, be data on this, rather than assumptions about effectiveness.

[Audio problem] (22:18) Moran: Yes, we can do R&D without patents. Can you raise money without patents? It is hard to persuade governments to fund R&D. Governments will always pay for everything in the end, ultimately. Governments prefer risk taken by others initially. So given how difficult it is, how else can we raise money to fund research properly?

[Audio quiet] Question from Paul Willis about counterfeiting drugs. (24:35) Drugs of poor quality are a problem, and a difficult issue. Solution is that we require better regulation. Comment from Saman Habib – poor drugs will occur with or without the patent system. Palombi: There is an international anti-counterfeiting trade agreement, but a confusion in the terminology has arisen about counterfeiting vs. patent violations. There was a warning about Avastin from Genentech about counterfeiting. This is not a patent infringement, but is instead criminal behaviour which can be policed, outside the patent system.

[28:10] Online question: How will the Myriad patent case affect the possibility of patenting genetic material. Are isolated (BRCA1) genetic mutations patentable subject matter? Court decision will be interesting, but possibly not very relevant to Aus because there may soon be a redefinition of patentable subject matter after a recommendation from the Australian Law Reform Commission. If that doesn’t happen, then the Myriad case might have an impact on whether natural biological materials can be patented. Australia may pass the Raising the Bar bill, which will introduce a research exemption to the Patents Act, but will not influence the scope of what may be patented. It’s unclear what will, generally, happen after that.